Tesco calls for lower supplier prices

Fruitnet.com 31 January 2009

Tesco chief executive Sir Terry Leahy claims suppliers must pass savings made from lower commodity prices on to consumers

Tesco has called on its suppliers to pass savings made from falling commodity prices on to consumers, claiming that it is critically important that savings translate into lower retail prices to ease financial pressures on shoppers.

In a keynote address at the prestigious City Food Lecture in London this week, Tesco chief executive Sir Terry Leahy (pictured) told an invited food industry audience that rising demand for discount goods underlined the need for lower prices for consumers.

“Commodity prices are down by over 50 per cent from their peak, while the price of oil is down by over US$100 – these lower prices need to be passed into the supply chain and fed on to consumers who are under growing financial pressure,” he said.

Sir Terry said that Tesco wanted to ensure that all its suppliers understood this and was “going to great lengths to speak to them about the pressures consumers are under”.

The Tesco chief executive argued that although the adjustment “would be difficult for some”, it was “critical if consumers are to be given what they need”.

As evidence of the demand for lower prices, Sir Terry claimed that the retailer was now Britain’s biggest discounter and said sales of Tesco’s discount and value ranges had increased by 65 per cent compared with a year ago.

He also delivered a robust defence of free market economics, claiming that agricultural subsidies were “too high”, reducing the efficiency of agriculture production and keeping food prices in protected markets “artificially high”.

But environmental concerns were also tackled in the speech and the Tesco chief claimed that government backing for biofuels had backfired, causing forests to be cleared and leaving “less land was available for other crops”.

European grocery prices to fall this year

Grocery prices are likely to fall this year as food retailers react to the rise of discounters and lower oil and raw material prices.

Steep food price inflation propelled the value of the European grocery market to euro 901.5bn in 2008, research house Verdict's European Grocery Retailers 2009 report showed.

But the plunge in the price of oil and better harvests last year have depressed price inflation, while the impact of the credit crunch and increased shopper focus on value are likely to be reflected by grocers.

The effect of the downturn on food retailers is anticipated to put a brake on mergers and acquisitions, format diversification and international expansion. Sale and leaseback deals are likely to lose their appeal and sales of non-food and organic goods are expected to take a hit.

Verdict European retail analyst and report co-author Daniel Lucht said: "While grocers are to a certain extent insulated against the downturn that hurting the rest of the retail sector, the effects of the credit crunch and onset of global recession will still be felt."

Privately-owned grocers such as Auchan, Leclerc and Rewe may be in the strongest position to profit from tough conditions. The report's co-author, Simon Chinn, said: "Being privately owned, such retailers are not under the same kind of financial pressure from investors that publicly listed retailers have to deal with.

"The companies are able to take a more long-term view of investment, which has been a key driver for many of these retailers' expansion strategies."

Source: retail-week.com


Publication date: 1/15/2009

UK: Environment secretary on food labelling

UK’s Environment Secretary Hilary Benn said that supermarkets and companies needed to label products more clearly to show consumers exactly where their food was coming from. Under current European regulations, a product's country of origin was the place where it had undergone its last significant process, but this could hide where it had really come from. Mr Benn suggested a voluntary labelling scheme for retailers and caterers that would show the country of origin. The Food and Drink Federation, however, said it would be an expensive move to label products like pizza or pies that had a number of ingredients. Speaking at the Oxford Farming Conference, Mr Benn said consumers could help boost the agricultural industry by eating healthier, locally produced food that was also more environmentally friendly because of less transport.

Robin Maynard, Soil Association Campaigns Director, commented that Hilary Benn should know there was already a label that delivered what he was calling for: the Soil Association's organic symbol, which offered a 'one-stop shop' for consumers wanting food free from bad ingredients, providing high animal welfare and care for the environment. Given organic farming used 26% less energy to produce the same amount of food as non-organic agriculture, organic farmers would be top contenders for Mr Benn's 'low-carbon farming award'. Robin Maynard continued that it was time the Secretary of State and Defra finally acknowledged that there was a burgeoning body of British farmers doing exactly what he and the public said they want, producing sustainable, climate-friendly food that was what our long-term food security depended on above all.


http://www.telegraph.co.uk

14.01.2009

Plantings double of first Australian-bred pineapple

Plantings of the first-ever Australian-bred pineapple have doubled in the past year, meaning there will be no shortage of the new variety for the niche markets targeted for 2009, according to the Department of Primary Industries and Fisheries.

Fifteen years in the making, the DPI&F's Aus-Jubilee is proving popular for its consistent good flavour from perfectly timed picking.

Commercial partner with DPI&F in the project, Favco, contracts growers to produce the fruit and ensures the fruit is picked at the right stage to achieve optimum eating quality.

Favco varietal development manager Doug Christensen said while plantings in 2008 stood at 300,000 plants, double those of the previous year, plant numbers would still need to increase to be more widely available on the fresh-fruit market.

"As a result of this year's plantings, the fruit's availability will increase when these plants harvest in 2010," he said.

"However, this is still a niche supply – the 2008 plant numbers will need to increase ten-fold for the new variety to be a year-round, commonly available, product.

"Taking advantage of its extra sweetness, the Aus-Jubilee supply will therefore concentrate on a shorter supply season through winter."

DPI&F senior horticulturist Dr Garth Sanewski said the intention of the Aus-Jubilee was to take the guess-work out of choosing a sweet pineapple by producing a fruit that was always good eating.

"The Aus-Jubilee was created specifically for consumption as a top-quality, fresh-fruit variety, allowing the juicier smooth cayenne to be the main variety for processing – canning and juicing," Dr Sanewski said.

He said hand-pollinated crosses from other pineapple varieties were made, taking the best traits from each until DPI&F scientists arrived at the ‘AJ’.

"‘AJ’ was selected as the preferred variety after major taste testing was done by DPI&F food scientists," Dr Sanewski said.

DPI&F senior research scientist Stephen Nottingham said of three varieties tested by consumers, the Aus-Jubilee was rated one of the highest for appearance; strong, yellow colour; and sweetness.

While the variety was available sporadically through Rocklea Markets, Mr Christensen said consumers would have to wait two to three years before it became more widely available.

"The ‘AJ’ pineapple is premium-sized in winter, and therefore has good market acceptance," he said.

"Marketable stock is limited in summer due to a natural reduction in fruit size, so we are still working on regulating this before the fruit goes mainstream."


Source: farmonline.com.au

Publication date: 1/14/2009

UAE: Fruit and vegetable market hit by downturn

Although some sectors such as banking and real estate have been heavily affected by the global financial crisis, its effect on the fruit and vegetable business has been relatively low.

The fall in oil prices and the onset of winter has slightly brought down the prices of some fruit and vegetables as more imports arrive from regional countries at a lower transportation cost.

Gulf News spoke to importers, wholesalers and retailers at Dubai fruit and vegetable market to find out how their businesses were running.

According to importers, the prices of necessary agricultural items have remained mostly unchanged while the price and demand for luxury fruit and vegetables has fallen slightly.

"Buying vegetables and fruit is not like purchasing or investing in the automobile or property industry. Food in general - and many agricultural products in particular, are necessary items and people will continue to buy them."

"However, the number of buyers and the purchase of quantities of vegetables and fruit these days has slightly gone down because many expatriates have lost their jobs and left the country. Many residents have also tightened their budgets and are not buying expensive fruit," said Husainy Sharbat, accounts manger at Kibsons International, a company which imports fruit and vegetables.

Travel costs

"In general the prices of necessary items such as potatoes, onions, garlic, ginger and salad items have mostly remained constant. But the price and demand for luxury fruit and vegetables such as grapes, lychees, etc has dropped by 10 to 15 per cent," said Arsalan, a Pakistani importer.

"Currently my business is down. Before those who cooked for a lot of people used to buy a lot of onions and potatoes from me, but now they buy these items in smaller quantities," said a Pakistani wholesale seller.

"My profits have decreased by 20 to 30 per cent," said a Bangladeshi wholesaler. "There are five of us here and there is nothing much to do these days," he added. Retailers at the market have complained that their businesses are not thriving for other reasons as well. They pointed out that its distant location and the heavy traffic on Emirates Road continue to be among the factors contributing to the low turnout of buyers at the market.

"The prices of some agricultural products have decreased and the quality of many items is also good due to the winter season, however, many residents still prefer to buy from grocery stores and supermarkets.

"When the market was located in Al Hamriyah, many people used to go there because it was close to residential areas. Now people are hesitant to come here," said a Bangladeshi seller.

"I don't go to the fruit and vegetable market because it is more convenient for me to shop at a hypermarket. It is like a one-stop shop where I can buy other kind of products as well. The last time I went there was two years ago," said Roopa Mathews, an Indian expatriate who lives in Al Twar.

"You may find fruit and vegetables at slightly cheaper prices there but the travel costs and traffic will add to your expenses," added Bena Soris, who has visited the market only twice.

"Before I used to buy all my groceries within a budget of Dh100 to Dh150. But these days I am spending around Dh300. I don't think the prices have gone down."


Source: gulfnews.com

Publication date: 1/13/2009

UK: Oranges are not the only fruit juice as sales dip

Orange juice has been pipped at Britain's breakfast tables by more exotic varieties for the first time.

Once a glass of OJ was the only way to start the day, but now early-risers are opting for unusual flavours like pineapple, cranberry and pomegranate.

Since 2003, sales of the traditional breakfast drink have been cut by as much as 13 per cent, with volumes dropping from 501million litres to 445million litres in 2008.

Meanwhile, apple juice - orange juice's nearest rival - has seen sales increase by 19 per cent over the same five-year period.

Five years ago orange juice accounted for 58 per cent of sales, but this has dropped to 44 per cent.

Apple juice is the second most popular flavour with 14 per cent of the market, while cranberry comes in at number three with eight per cent of volume sales.

A spokesman for market analysts Mintel, which compiled the figures, said: "Sales of orange juice have suffered as Brits have been tempted by other more exotic flavours such as tropical, pineapple and mango.

"Although orange juice is still the number-one selling fruit juice, sales have fallen dramatically."

Grapefruit juice has also seen sales drop by 10 per cent since 2003.

Mintel's report said: "The superfood phenomenon plays a strong part in the juice market with flavours such as cranberry and pomegranate growing.

"New product development has also seen blueberry juice becoming more popular."

But the credit crunch has seen those who bought premium fruit juices and smoothies now opting for less expensive supermarket own-brands.


Source: mirror.co.uk

Publication date: 1/9/2009

Philippines: Firm grows bananas in land of pineapples

A local fruit grower is planting bananas in the land of pineapples, creating an alternative livelihood source for residents here.

Mont Manna Fruits, Inc. wants to make Ormoc, known for its pineapples, to become a major banana processor.

Former Ormoc City Councilor Jose Serafica, who founded Mont Manna, said the company could serve the rising demand for banana in the Visayas. Most Visayan provinces get their bananas from Davao.

Mr. Serafica started with a four-hectare farm in Luna, about seven kilometers north of downtown Ormoc. Using tissue culture, Mont Manna propagated the lakatan variety from Davao and claims to have managed to produce bananas that are golden yellow in color, bigger and fuller in size, and carry a pleasing smell and sweeter taste.


Source: bworldonline.com

Publication date: 1/9/2009

UK: Imported fresh produce prices to soar

David says: Will exotics be affected? Of course


The cost of fresh fruit and vegetables will soar this year as European farmers shun the plunging pound. British importers believe shoppers will face increases as high as 20 per cent in coming weeks, with some produce disappearing from our shelves altogether. All sorts of fresh produce is affected but potatoes, onions and tomatoes are particularly at risk from fluctuating prices.

Producers and growers on the Continent are losing out because of sterling's slide and are putting up their prices for the UK market to compensate or bypassing it altogether in favour of their eurozone neighbours who have not been hit by sterling’s currency slump.

In weeks the pound has lost almost a quarter of its value against the euro, creating a nightmare for importers.

While independent shops will be hardest hit because they don’t have the commercial muscle of the major supermarket chains, even retail giants like Tesco and Sainsbury’s will be forced to up prices, if pressure on margins continues.

Some analysts believe even more greengrocers will disappear from our high streets. Simon Lane, managing director of importers Fruco plc, said: “The problem is that the producers and growers have the option to sell to other markets in the EC. “Margins when dealing with sterling are being squeezed all round and inevitably people here will have to pay more for their fresh produce.” More than 3,000 greengrocers have vanished from Britain’s high streets in the past decade.

Alex Liasi, of wholesalers 4degreesC in London’s New Spitalfields market, said: “One of our farmers in Spain says he is currently losing £500 on every lorry load of fresh produce he sends to the UK. “A lot of produce is now being shipped to Russia because they are prepared to pay more than we are.


Fruit and vegetable prices are already at risk from controversial European Union rules which would see many of the pesticides used by UK farmers outlawed.


Source: internationalsupermarketnews.com

Publication date: 1/8/2009

Exotic fruit sales plunge in Italy

CIA reports 25 per cent year-on-year fall in sales of pineapples, bananas, avocados and mangoes during festive period

The amount of exotic fruit consumed in Italy over the festive period fell dramatically compared with the same period of 2007, according to Italian farming organisation CIA.

In a statement, the group reported a year-on-year downturn of more than 25 per cent in sales of fruits such as pineapples, avocados, bananas and mangoes eaten in the country over Christmas and New Year.

Overall sales of fresh fruit and vegetables fell by 1.5 per cent compared with the year before, according to CIA. However, sales of dried fruit and nuts rose by 2.5 per cent, while vegetable sales grew by 3.5 per cent on the back of increased demand for lentils and beans.

Before Christmas, Italy's Minister of Agriculture Luca Zaia called on consumers to boycott pineapples and other imported food items over the holiday period in favour of traditional domestic products.

The calls were met with dismay from the trade, however, with industry body Fruit Imprese labelling the minister's comments "misguided".
According to CIA, the majority of Italy's 23m families did their shopping in retail stores (56 per cent), followed by traditional stores (24 per cent), local markets (18 per cent) and the internet (2 per cent)

www.fruitnet.com 5 January 2009